To buy or not to buy!

[livingthesimplelife]

I'm a single parent and have a well-paid job. At the moment I have a housing association flat, paying £800 a month, enabling me to save circa £450 a month with a good amount left over.

I am thinking about shared ownership, and have read up a lot about the pros and cons. To me, it seems to be the only way I will be able to get on the property ladder. I live in an expensive area, and am tied to this area (school, support etc.)

I have found a house I really like, with a garden that we are desperate for. But with interest rates, I have been offered a 5 year fix of 5.35% and 2 year of 6.13%. This would bring my mortgage and shared ownership rent up to around £400 higher than my current rent, enabling me to save at a stretch £200 a month.

Would you go for it to get on the ladder? If so, would you go for a 2 year or 5 year fixed?

Or should I wait a year to build my deposit and let interest rates sit/come down a little?

Do you have your housing association flat for life? If so, I would be reluctant to give that up in exchange for shared ownership, tbh.

I think I would prefer to carry on renting and saving up with a view to possibly buying a property in the future (maybe when you don’t have to be in such an expensive catchment area) not via the SO route.

I don’t think either of those rates found very attractive either. I would really hesitate to give up what you have in exchange for high interest rates on a home you will only have part ownership of anyway.

Don't make the mistake of getting into "shared ownership" at the moment - when you have a good alternative. It's not in fact shared at all. You will be responsible for all the maintenance and repair cost PLUS the full impact of the coming falls in value will be on you alone.
Keep saving as hard as you can and wait for this market correction to play out. If you focus you might be able to buy without shared ownership sooner than you think.

I would wait a couple of years. Build your deposit. Remember any money you can put down on buying a home up front will massively decrease the amount you owe over time because of compound interest.

I have 31 years left on my mortgage and if I pay £400 extra today it will save me £900 in interest payments.

⅔ of every standard monthly mortgage payment I make goes to interest. Only ⅓ pays off the balance of my mortgage. Better to have as much money up front as possible.